Bitcoin (BTC) and other digital assets fell amid a broader market sell-off and there is a risk that the forced sell-off could lead to further weakness, the investment bank said on Monday Standard Chartered in a report.
The market downturn was triggered by Federal Reserve Chairman Jerome Powell’s hawkish press conference in mid-December.
The bank noted that investors who gained exposure to bitcoin after November’s US election are now “only breaking even” and there is a risk that forced or panic selling could worsen the sell-off. This includes buyers of exchange-traded funds (ETFs) and BTC buyer MicroStrategy (MSTR).
“The risk of mark-to-market difficulties is increasing,” wrote Geoff Kendrick, head of digital assets research at Standard Chartered.
If the world’s largest cryptocurrency falls below the key $90,000 level, it could fall 10% back to the lowest level of $80,000, the report said, and other digital assets would also likely fall .
The bank advises adding Bitcoin once the retracement is complete.
Standard Chartered still expects bitcoin to reach $200,000 by the end of the year, fueled by the resumption of institutional flows under the new Trump administration.
Learn more: Bitcoin Bull Tom Lee Sees BTC Reaching Up to $250,000 by Year-End
